Taking payment in Ethereum brings in a gamut of advantages for both users and entrepreneurs.
Transitioning to a blockchain-based ecosystem brings in a string of advantages for users as well as entrepreneurs. Here is a drop-down detailing why accepting payment in Ethereum works well for the customers of an enterprise:
Additional payment option
In a world that is fast adopting cryptocurrencies, providing customers with an additional payment option gives businesses an advantage over their competitors. Cryptocurrency gateways enable merchants to accept digital payments and receive the amount in fiat.
A decentralized ecosystem is inherently transparent, giving customers more confidence while making the purchase. Crypto transactions get executed on a blockchain where they are written irrevocably, without any prejudice of a centralized authority.
Ethereum transactions in such purchases get routed through a smart contract, making fraudulent activities less likely. When smart contracts are audited, scamsters have negligible chances of succeeding.
Global transactions in Ethereum are considerably quicker, compared to conventional international payments. Crypto transactions get executed in minutes, while fiat transactions routed through banks might take days to reflect in the account.
Enterprises too have a set of strong reasons to begin accepting ETH.
Finality refers to a transaction’s status when it is part of a block that cannot change. In Ethereum, conventionally working on proof-of-work (PoW) consensus algorithm, the average time for achieving finality is six minutes (25 confirmations) while the average time to mine a single block is 15 seconds.
This is considerably lower than Bitcoin (BTC), the largest cryptocurrency, which takes 60 minutes (six confirmations) to attain finality with the average time of 10 seconds to mine a block. When the Merge (the implementation of Ethereum’s consensus layer) is complete, the time it takes for an ETH transaction to reach finality will further decrease.
Ethereum has a decentralized architecture designed to allocate information and trust without prejudice, eliminating any need for a central entity to coordinate data. The decentralized system seamlessly manages the system and processes transactions.
The ecosystem facilitates the development of mechanisms that reward supportive activities like verification and availability, while punishing activities that negatively affect the blockchain and surrounding mechanism. Incentives to promote honest behavior help to meet security requirements.
Any asset that has been registered in a digital format can be tokenized on Ethereum. Tokenization helps fractionalize previously cumbersome assets such as real estate, which had become simply too expensive and unravel new economic models such as crowdsourced data management.
Merchants with no prior exposure to crypto assets could find it overwhelming to send and receive cryptocurrencies. Crypto wallet addresses are a long string of digits and letters. Moreover, one requires a different address to collect each cryptocurrency payment.
Thanks to the Ethereum Name Service (ENS), users can create a universal nickname for all their public addresses. Rather than using an unreadable array of keys for receiving crypto payments, they could have a single ENS domain, like ‘Joseph.eth.’